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3 charged in securities conspiracy

Two California lawyers and a Japanese businessman have been charged with conspiring to market $16-billion in counterfeit Japanese securities.

The three were named in an amended federal indictment returned Thursday in Tampa. Two men from Arizona and Seattle and an Arizona woman were indicted earlier after the men were arrested in a Tampa sting set up by federal agents.

The indictment charges all six with conspiracy, fraud and money laundering related to the attempted sale of bogus Japanese bonds. Agents seized bonds with a purported face value of about $2-billion after the arrests in January.

Norbert Schlei, 63, of Santa Monica, Calif., an assistant U.S. attorney general under President Kennedy, was among those named in Thursday's indictment. Also charged are Toshio Takahashi, a Japanese investor, and Alan Reedy, a lawyer from Costa Mesa, Calif.

The indictment charges that Schlei knew the bonds were counterfeit. His attorney, Peter George of Tampa, said Schlei knew only that the Japanese government disputed the validity of the securities.

George said Schlei represents a group of Japanese citizens who have been holding the bonds, which he said were issued in secret by the Japanese government in an effort to hide a political fund. Since 1985, George said, the group has been trying to get the Japanese government to recognize the securities as valid.

But George said Schlei had no knowledge of the alleged attempts to sell the bonds to undercover agents in Tampa. Nor did Schlei ever have intent to defraud anyone with the bonds, George said.

The huge face values of the bonds _ the smallest being about $400-million _ made it virtually impossible for anyone to be defrauded, George said. Anyone would check with the Japanese government before investing in such securities.